Join our participants as they reduce debt and increase savings with the help of Summit financial coaches.
Jaclyn and Kiara's Journey:
Loans, Protection Plans & Auto Pay - OH MY!
Hey there and welcome back! As you all know, we have been working to refinance all of Jaclyn’s loans in order to make them JOINT loans. Drum roll please….it was a success!! So let’s talk about the benefits of this. Not only will Kiara have four new positive trade lines to add to her credit score (auto loan, personal loan, overdraft protection and credit card) but we will be reducing all of the interest rates! Our personal loan, auto loan and credit card interest rates all went down at least 1.5-2%! If you haven’t considered your options, it’s never too late to talk to your financial institution to see if you have options available to you. So, our first plan is to take the $2,950 we got from the auto loan and use that to pay off the current balance on our credit card which will leave us with only a little less than $500 left to pay it off completely. Thank goodness for that $250 bonus we got last month so we are already more than halfway there. You must be thinking, “Why use one debt in order to pay off another?” Look at it this way—we went from having an ‘unsecured’ high interest loan balance (credit card) and we leveraged our asset (car) to ‘secure’ the loan. The results—25% down to 9%! It’s a no-brainer for us. Bring on the loan!
We also learned about a little thing called a protection plan this week. Essentially, it’s such a great choice and a huge necessity. The way it works is that you pay a fee depending on the size of your loan and it will cover you in case of a financial crisis (i.e. the loss of income due to lack of employment, illness preventing you from working, etc.) Make sure to check with your financial institution in order to see if they can provide any of this to you! Whether it’s a lower interest rate or some protection, anything can help! And if you are banking with Summit, make sure you know that they will always help you figure things out!
One other big question for you guys this week...How does auto pay make you feel? No really, we would like to know. Because nothing has created more anxiety for us than auto pay. With that being said, we do pay our bills, but auto pay presents a lack of control and in the past, since our finances were so limited, we couldn’t handle the thought of paying things automatically. Due to the recent changes we have made in the past month since Project Money started, we are feeling more CONFIDENT than ever! We were able to refinance our loans and credit cards jointly and then our financial coach, Jamie, was able to set up auto pay right away for all of those due dates. Did it make us nervous this time? NO! Did we bat an eye? NO! But did it feel amazing? YES! We have begun making the necessary changes in our spending in order to not have to move money around in order to pay some things now and some things late. Now we can have payments deducted automatically from or new JOINT account. We are taking the necessary steps together in order to better our financial future and man does it feel good. We are taking back CONTROL! We hope that you will continue to follow along with us and take anything you feel may be helpful and please use it for yourself! Everyone deserves to be in control of their finances and together, we all can!